Classification Societies play a vital role in international shipping
Founded in 1913, the Russian Maritime Register of Shipping (RMRS) is one of the oldest and most prestigious classification societies in the world. It was founded in order to promote safety in navigation; safe working conditions for sailors, stevedores and other staff; ship and cargo security; protection of the environment; and proper inspection and classification of ships, oil rigs and other offshore structures. Work done by the RMRS and other classification societies allows proper assessment of insurance risk so that international commerce on the seas is as safe and efficient as possible.
The HMS Titanic and LLoyd’s of London
It was a little more than one hundred years ago when the flagship of the White Star Line, the “unsinkable” Titanic crashed against an iceberg in the North Atlantic on her maiden voyage and sank into the icy waters. About two thirds of the people on board perished, 1514 in all. The Titanic immediately became a permanent part of the psyche of generations of people, and has been the source of books, legends, and movies. One little known part of the story of the Titanic is the role played by Lloyd’s of London, the insurance giant established in 1688, before, during and after the disaster.
The loss of life might have been greater had it not been for a system of wireless telegraphy signal stations that had only recently been installed on ocean going vessels and land based facilities across the North Atlantic from England to Canada. This system allowed vessels to remain in touch with other radio operators during the journey. Lloyd’s was a major sponsor, and worked directly with Marconi himself to set it up. The Titanic’s distress call was received by the Marconi Company’s Cape Race Station in Newfoundland.
Lloyd’s had insured the hull for 1 million pounds after collecting a premium of only 7,500. Not only that, but Lloyd’s insurers and reinsurers had already suffered unusually heavy losses in the six months before the Titanic sank. Nonetheless, claims were paid in full within 30 days, and in spite of other years of heavy losses, Lloyd’s has remained solvent for more than 325 years.
About 80 percent of the volume of the world’s merchandise moves by sea. Effective management and supervision of that trade is vital. Every country in world receives and ships goods by sea, and that cargo must move safely, efficiently, and with minimum impact on the environment. Therefore, every country in the world has an interest in seeing that they have effective access to international shipping services and ports. According to the United Nations, containerization of maritime transport “has been a stronger driver of globalization than trade liberalization” and the business of overseas shipping faces challenges such as “energy security and costs, climate change, and environmental sustainability.” This is indeed serious business, and the scope of the industry is as big as it gets.
Also, cargo must be insured, and estimating the risk of insurance requires that vessels and port facilities be properly inspected and evaluated, and that estimators have access to high quality data. The duty for performing these inspections rests with marine classification societies.
Lloyd´s was also intimately involved in the creation of the first classification society in the second half of the 18th century. Underwriters at Lloyd’s hired retired sea captains to inspect the vessels they were asked to insure and assign them a rating in accordance with the condition of the hull and the condition of the equipment on board, and published Lloyd’s Register of Ships. Eventually, Lloyd’s hired professional inspectors and the first classification society was born.
Today, there are more than fifty marine classification societies in the world, and the twelve most important ones have formed the International Association of Classification Societies (IACS), headquartered in London. The IACS establishes technical and engineering standards for ships and other marine related facilities, and provides a forum for discussion and improvement of criteria which makes maritime trade safer and cleaner.
According to the IACS website, the mandate of classification societies is “to provide classification and statutory services...and assistance to the maritime industry and regulatory bodies as regards maritime safety and pollution prevention, based on the accumulation of maritime knowledge and technology [and to] verify the structural strength and integrity of essential parts of the ship….”
But not every classification society is eligible to be a member of IACS. Criteria for entry into the organization are strict, and most classification societies don’t make the grade. The ones that do are subject to constant and rigorous peer and governmental scrutiny, and the IACS acts as a clearinghouse for information which ensures that its high quality standards are met. The IACS, among other things, advises governments and the United Nations on issues of maritime safety and environmental stewardship.
As an organization, the IACS’ stated values are Leadership, Technical Knowledge, Transparency, and Quality Performance, and the organization insists that its members adhere to the highest quality standards at all times. In fact, member organizations are subject to audits in order to ensure compliance with quality standards. Because of the prestige of the organization and its members, more than 90% of the world’s cargo tonnage is subject to standards set by IACS members.
The classification societies themselves perform inspections during the shipbuilding process and afterward to verify that its service and maintenance is in accordance with strict standards set by the society and the IACS. They also inspect and classify oil platforms, other offshore structures, and submarines.
Russian Maritime Register of Shipping Plays a Vital Role in World Sea Transport
Founded in 1913, the Russian Maritime Register of Shipping (RMRS) is one of the oldest and most prestigious classification societies in the world with a solid reputation for quality. It was founded in order to promote safety in navigation; safe working conditions for sailors, stevedores and other staff; ship and cargo security; protection of the environment; and proper inspection and classification of ships, oil rigs and other offshore structures. RMRS has a policy of continuous improvement and strict compliance with international standards in the areas of its responsibilities. RMRS employs the most modern techniques of corporate governance, quality management systems, and implementation of high technical standards in ship design and construction. In addition to being a member of the IACS, RMRS is also works with the International Maritime Organisation, the International Organisation for Standardisation and the International Labour Organisation.
RMRS works from 109 offices throughout the world and is responsible for classification of nearly 7,000 vessels registered in more than 40 countries. It relies on a workforce of more than 1500 specialists to deliver the highest quality service available anywhere. These services include compliance with the International Safety Management Code, a series of safety management systems designed to eliminate human error from the safe operation of ships and floating structures.
Other services include issuance of evaluations, certificates and reports on all technical aspects of vessels, including their powerplants, tonnage measurements for ships and offshore installations, compliance certifications, certificates of safety management systems, and data delivery to port authorities and other governmental agencies.
Technical expertise is a touchstone for maintaining quality standards for any classification society. RMRS established a Scientific and Technical Council the year after it was founded, and has always availed itself of cutting edge technology. For instance, it was the first maritime classification society to develop requirements for Arctic ships; it was the first to establish rules for electric welding in the construction and repair of ships, and remains the only classification society in the world capable of issuing class certification for nuclear ships.
RMRS has an internal quality management system which has been ISO 9001 compliant since 1993, meets ISO/IEC 17020 standards and is certified by GOS and by SAI. The European Union issued a certificate of compliance in 1999, and RMRS is compliant with the IACS Quality System Certification Scheme. The quality management system is managed by the Quality Division within RMRS, and guarantees effectiveness in delivery of services by ensuring that the organizational structure and processes are always the best.
The Quality Division within RMRS deserves special mention because of the important and sensitive nature of the services RMRS provides. It oversees not only the quality policy within the organization, but also monitors compliance with new international standards; follows up on directives and recommendations from the IACS Council; organizes training of personnel on quality management; performs internal audits and supports external audits; produces quality management system documentation; and designs and implements responses to quality audits.
The commitment of RMRS to quality has brought the company to the attention of the IACS, when RMRS was elected to the vice-chairmanship of the IACS Quality Committee. It was an honor resulting from the society’s sterling reputation and commitment to making maritime.
Because of its commitment to continuous quality improvement, Russian Maritime Register of Shipping has been selected to receive the BID International Star Award for Quality for 2015 at the convention in Geneva.
About BID and the International Star Award for Quality:
BID is a private and independent organization founded in 1984, whose primary activity is business communication orientated towards quality, excellence and innovation in management. A leader in the broadcasting of Quality Culture, BID recognizes those companies and organizations which lead the most important activities in the business world, and is considered the founding organization in the broadcasting of the Culture of Quality, Excellence and Innovation in 179 countries.
The trophy symbolizes a pledge to the principles of Quality Culture. The QC100 Total Quality Management Model, together with the Quality Mix program, media coverage of the convention and its impact on the community and business sector, create an unmatched platform for continuous improvement within the organization and awareness of the achievements of the company at an international level.
Awards are given only to those who are committed to improving their Quality Culture based on the principles of the QC100 Total Quality Management Model. Candidates are proposed by the leaders of previously awarded companies who they consider worthy of the award. Especially meritorious candidates may also be nominated. The International BID Quality Award Selection Committee then chooses the winning companies who will receive the award in New York, Paris, Geneva, Frankfurt, Madrid and London.